published Tuesday, June 3rd, 2014

Marion County investigation reveals 'burner' phones, fake documents used in fraud scheme

A Marion County, Tenn., investigator assigned to the federal Bureau of Alcohol, Tobacco, Firearms and Explosives testified Monday that searches in a decades-long fraud case revealed houses with piles of “burner” phones and possibly faked financial documents to keep the scheme alive for a Texas couple with Marion County ties.

Detective Chad Johnson came across suspicious wire transfers, some up to $60,000, from an Arizona source when he was investigating a marijuana trafficking and money laundering scheme in Marion County in 2011.

U.S. Magistrate Judge Bill Carter denied bond to Steven Audette and Mary Roach, both charged with wire fraud in connection with the alleged scheme. The judge said he believed the pair were “in cahoots” and had “engaged in conduct in a very careful way.”

As Johnson dug deeper, he found that the money source wasn’t a cartel funder but instead a grandmother in her 70s, possibly 80s, who’d been swindled out of more than $2 million with threats against her family, cryptic text messages and phone calls with gunfire in the background.

Audette, 56, had been extorting money from the Scottsdale, Ariz., grandmother, listed only as L.M., for years, according to federal prosecutor Gregg Sullivan. Audette and his wife, Roach, 53, were arrested recently in Bridgeport, Ala., when Johnson spotted a car parked behind the home of Roach’s brother, Ricky Roach.

Agents who raided two Texas homes of the couple found 20 or more prepaid, “burner” mobile phones in one house and 60 such phones in the other. The prepaid phones are not registered to a name and sometimes are used in crimes to avoid detection, Johnson testified.

ATF Resident-Agent-in-Charge Daryl Hill declined specific comment on the case but shared a statement after the hearing:

“In keeping with ATF’s national Frontline strategy, ATF Chattanooga and its law enforcement partners will continue to impact and promote public safety by using all available resources, thus improving the quality of life in our communities,” Hill said.

It was while investigating allegations of marijuana trafficking against Ricky Roach back in 2011 that Johnson had found financial records uncovering Audette and Mary Roach’s alleged fraud scheme.

Audette continued to tell investigators during an interview last year in Laredo, Texas, where he and his wife were living, that he was being chased by the mafia and helping the CIA with a secret government operation.

Johnson testified that while being arrested Audette threatened Hill, telling the agent, “his day was coming.”

Mary Roach said she wasn’t on the run and didn’t fear for her safety. She claimed money coming from the Arizona woman into her family members’ accounts that was then cashed out for her was to pay her bills and support a Laredo hair salon.

Carter ordered the pair sent to Arizona, where the criminal complaint was filed by the U.S. Attorney’s Office there. Unless one or both of the defendants decides to plead guilty here, the case will be set for trial in Arizona.

Contact staff writer Todd South at tsouth@timesfree or 423-757-6347. Follow him on Twitter @tsouthCTFP.

about Todd South...

Todd South covers courts, poverty, technology, military and veterans for the Times Free Press. He has worked at the paper since 2008 and previously covered crime and safety in Southeast Tennessee and North Georgia. Todd’s hometown is Dodge City, Kan. He served five years in the U.S. Marine Corps and deployed to Iraq before returning to school for his journalism degree from the University of Georgia. Todd previously worked at the Anniston (Ala.) Star. Contact ...

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